New online bank offers higher intrest rates

dimetime · #1 08-30-2008, 08:56 AM

The New York Private Bank and Trust which is the holding company of Emigrant Bancorp, INC. has laid claim on Monday that the company will be providing the highest rate of intrest in the U.S.
Dollar Savings Account will be offering 3.75% intrest rates on deposits of at least $1,000 or more. Which the current rate of intrest offered by rival online banks ING is 3% and HSBC direct is 3.5%. Though these banks do not require a set amount for deposit.
For those accounts which are below the $1,000 dollar amount will recieve a 1% intrest rate, and no fees will be charged to account holders.
In a time of economic instability this venture will make its debut. The housing market has weighed heavely on the economic growth and the financial system of this nation. The cheif executive for Emigrant Bancorp INC, Howard Milstein says that even though we are stuggling economicaly he has no worries that Americans will be detered from saving as much as possible.
The 3.5% intrest rate is better than what competitors are offering the people and it is the rate at which they hope to continue to pay the people.
Granted this downturn in our economy has been hitting brokerages and banks really hard, and online banks are effected as well. Just last year NetBank INC was shut down and they had more than $2 billion in assets. The bank was insured by FDIC and a total of $1.5 billion in assets were assumed by the ING Bank.
Rates have been cut by many banks associated with savings accounts, just as the Federal Reserve has cut rates, both earlier this year as well as last year. The difference is online banks are paperless which cuts a great deal of costs and allows them to sustain a higher rate of intrest. For an online bank which is paperless saves alot of money, not only because it eliminates the use or need for paper but also saves alot in the costs of postage.This venture is a great advantage for the people and is a huge savings on expenses for the company. Another saving issue is that those brick and mortar banks have more overhead costs than banks online. Though as with everything else banks have become more and more competitive in recent years. HSBC is quite a strong competitor as well as ING. The new forerunner of this new online bank Dollar Savings Bank was founded back in 1980, then in 1983 merged with Dry Dock which is another bank based in New York.
Emigrant Saving Bank became a part of New York Private and Trust in 2005 and has an estimated $13 billion in assets.

dollardaze · #2 08-31-2008, 06:57 PM

I'm wondering just how online banking works. Does a depositer have to direct-deposit their money? Also I wonder how safe these banks are, and what kind of security is in place to keep a persons savings safe with all the stolen accounts that have taken place recently.

dimetime · #3 09-01-2008, 09:58 AM

Online banking does not have to have direct deposit. As for how safe are they?... Well this is something that each person should do some serious research,as some banks have more security in place than others. Contact banks that offer online banking and find out what types of security they have in place to prevent things like identy theft, unauthorized access and so on. By doing a little research you will give yourself the piece of mind knowing what bank offers what types of security.

dollardaze · #4 09-02-2008, 01:54 AM

I think I'll stick with my good ole bank down the street, where I can go and yell at people when they mess up.

I may be old fashioned, but I don't do a lot of my banking online because I just don't trust that it's all that safe to use.

pennypinch · #5 09-03-2008, 01:40 AM

Is this bank only online or brick and mortar also? I see dollardaze's question was, How do you make a deposit to such a bank if it is not direct deposit only? I really don't have a great understanding of these kind of things so I have no idea lol. I agree with dollardaze, I think I will stick to the bank I have been dealing with for years now. Nice people who do a good job!

moneysense · #6 09-03-2008, 02:05 PM

What irks me about these interest rates is that they are on accounts of $1000. or more. That leaves us little people with not a lot of money dealing with a 1% interest rate which we could equal or do better for at a local bank.

As to online banking, I too am skeptical when it comes to doing my banking this way. So, do you have any further information on online banks that may be safer than most other online banks?